STAGWELL INC. (NASDAQ: STGW) REPORTS RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2025

Q1 YoY Revenue Decline of 3%, Q1 YoY Net Revenue Growth of 6%Q1 YoY Net Revenue Growth excluding Advocacy of 9%, Digital Transformation Net Revenue ex. Advocacy Growth of 15%Q1 Net Loss Attributable to Stagwell Inc. Common Shareholders of $3 million; Q1 Adjusted EBITDA of $81 million; Adjusted EBITDA Margin of 14%Q1 EPS of $(0.04); Adjusted EPS of $0.12Net New Business of $130 million in Q1; LTM Net New Business of $446 millionReiterate Guidance for 2025 of Total Net Revenue Growth of ~8%; Adjusted EBITDA of $410 million to $460 million; Free Cash Flow Conversion in excess of 45%, /PRNewswire/ -- (NASDAQ: STGW) – Stagwell Inc. ("Stagwell") today announced financial results for the quarter and three months ended March 31, 2025.FIRST QUARTER RESULTS: STAGWELL INC. (NASDAQ: STGW) REPORTS RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2025 Q1 Revenue of $652 million, a decrease of 3% versus the prior year period; Q1 Revenue ex. Advocacy of $610 million, an increase of 1% versus the prior year period; Q1 Net Revenue of $564 million, an increase of 6% versus the prior year period; Q1 Net Revenue ex. Advocacy of $535 million, an increase of 9% versus the prior year period; Q1 Net Loss attributable to Stagwell Inc. Common Shareholders of $3 million versus $1 million in the prior year period; Q1 Adjusted EBITDA of $81 million, a decrease of 11% versus the prior year period; Q1 Adjusted EBITDA Margin of 14% on net revenue; Q1 Earnings Per Share Attributable to Stagwell Inc. Common Shareholders of $(0.04) versus $(0.01) in the prior year period; Q1 Adjusted Earnings Per Share attributable to Stagwell Inc. Common Shareholders of $0.12 versus $0.16 in the prior year period; Net new business of $130 million in the first quarter, last twelve-month net new business of $446 million See "Non-GAAP Financial Measures" below for explanations and reconciliations of the Company's non-GAAP financial measures.Mark Penn, Chairman and CEO of Stagwell, said, "Despite the macro noise from tariffs, Stagwell's first quarter results were in-line with our expectations, setting us up for a strong year ahead. Q1 is a low point in the political cycle and yet we delivered solid growth in the quarter, led by double-digit increases in our Digital Transformation, Creativity and Stagwell Marketing Cloud capabilities. We hit a record $130M of net new business and, consequently, we remain optimistic about our outlook for the rest of the year."Frank Lanuto, Chief Financial Officer, commented: "Stagwell delivered solid first quarter results. We reported 9% total net revenue growth excluding advocacy, while posting $81 million in adjusted EBITDA as we effectively managed costs. Additionally, we have made significant progress in simplifying our capital structure and refinancing our revolving credit facility. Our results and these actions position us well for the year ahead." Financial Outlook2025 financial guidance is reiterated as follows: Total Net Revenue growth of approximately 8% Adjusted EBITDA of $410 million to $460 million Free Cash Flow Conversion in excess of 45% Adjusted EPS of $0.75 - $0.88 Guidance includes anticipated impact from acquisitions or dispositions. * The Company has excluded a quantitative reconciliation with respect to the Company's 2025 guidance under the "unreasonable efforts" exception in Item 10(e)(1)(i)(B) of Regulation S-K. See "Non-GAAP Financial Measures" below for additional information. Video WebcastManagement will host a video webcast on Thursday, May 8, 2025, at 8:30 a.m. (ET) to discuss results for Stagwell Inc. for the quarter and three months ended March 31, 2025. The video webcast will be accessible at https://bit.ly/436rkSP. An investor presentation has been posted on our website at www.stagwellglobal.com and may be referred to during the webcast.A recording of the webcast will be accessible one hour after the webcast and available for ninety days at www.stagwellglobal.com.Stagwell Inc.Stagwell is the challenger network built to transform marketing. We deliver scaled creative performance for the world's most ambitious brands, connecting culture-moving creativity with leading-edge technology to harmonize the art and science of marketing. Led by entrepreneurs, our specialists in 45+ countries are unified under a single purpose: to drive effectiveness and improve business results for their clients. Join us at www.stagwellglobal.com.ContactsFor Investors:Ben Allanson[email protected]For Press:Beth Sidhu[email protected]Non-GAAP Financial MeasuresIn addition to its reported results, Stagwell Inc. has included in this earnings release certain financial results that the Securities and Exchange Commission (SEC) defines as "non-GAAP Financial Measures." Management believes that such non-GAAP financial measures, when read in conjunction with the Company's reported results, can provide useful supplemental information for investors analyzing period to period comparisons of the Company's results. Such non-GAAP financial measures include the following:(1) Net New Business: Estimate of annualized revenue for new wins less annualized revenue for losses incurred in the period.(2) Adjusted EBITDA: defined as Net income excluding non-operating income or expense to achieve operating income, plus depreciation and amortization, stock-based compensation, deferred acquisition consideration adjustments, and other items. Other items include restructuring costs, acquisition-related expenses, and non-recurring items.(3) Adjusted Diluted EPS is defined as (i) Net income (loss) attributable to Stagwell Inc. common shareholders, plus net income attributable to Class C shareholders, excluding amortization expense, impairment and other losses, stock-based compensation, deferred acquisition consideration adjustments, discrete tax items, and other items, divided by (ii) (a) the per weighted average number of common shares outstanding plus (b) the weighted average number of Class C shares outstanding, (if dilutive). Other items includes restructuring costs, acquisition-related expenses, and non-recurring items, and subject to the anti-dilution rules.(5) Free Cash Flow: defined as Adjusted EBITDA less capital expenditures, change in net working capital, cash taxes, interest, and distributions to minority interests, but excludes contingent M&A payments. Free Cash Flow Conversion is the percentage of adjusted EBITDA.Included in this earnings release are tables reconciling reported Stagwell Inc. results to arrive at certain of these non-GAAP financial measures.This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The Company's representatives may also make forward-looking statements orally or in writing from time to time. Statements in this document that are not historical facts, including, statements about the Company's beliefs and expectations, future financial performance, growth, and future prospects, the Company's strategy, business and economic trends and growth, technological leadership and differentiation, potential and completed acquisitions, anticipated and actual operating efficiencies and synergies and estimates of amounts for redeemable noncontrolling interests and deferred acquisition consideration, constitute forward-looking statements. Forward-looking statements, which are generally denoted by words such as "ability," "aim," "anticipate," "assume," "believe," "build," "consider," "continue," "could," "develop," "drive," "estimate," "expect," "focus," "forecast," "future," "guidance," "intend," "likely," "maintain," "may," "ongoing," "opportunity," "outlook," "plan," "possible," "potential," "probable," "project," "seek," "should," "target," "will," "would" or the negative of such terms or other variations thereof and terms of similar substance used in connection with any discussion of current plans, estimates and projections are subject to change based on a number of factors, including those outlined in this section. Forward-looking statements in this document are based on certain key expectations and assumptions made by the Company. Although the management of the Company believes that the expectations and assumptions on which such forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. The material assumptions upon which such forward-looking statements are based include, among others, assumptions with respect to general business, economic and market conditions, the competitive environment, anticipated and unanticipated tax consequences and anticipated and unanticipated costs. These forward-looking statements are based on current plans, estimates and projections, and are subject to change based on a number of factors, including those outlined in this section. These forward-looking statements are subject to various risks and uncertainties, many of which are outside the Company's control. Therefore, you should not place undue reliance on such statements. Forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update publicly any of them in light of new information or future events, if any.Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statements. Such risk factors include, but are not limited to, the following: risks associated with international, national and regional unfavorable economic conditions, including the effect of changing tariff and other trade policies, inflation and other macroeconomic factors that could affect the Company or its clients; demand for the Company's services, which may precipitate or exacerbate other risks and uncertainties; inflation and actions taken by central banks to counter inflation; the Company's ability to attract new clients and retain existing clients; the impact of a reduction in client spending and changes in client advertising, marketing and corporate communications requirements; financial failure of the Company's clients; the Company's ability to retain and attract key employees; the Company's ability to compete in the markets in which it operates; the Company's ability to achieve its cost saving initiatives; the Company's implementation of strategic initiatives; the Company's ability to remain in compliance with its debt agreements and the Company's ability to finance its contingent payment obligations when due and payable, including but not limited to those relating to redeemable noncontrolling interests and deferred acquisition consideration; the Company's ability to manage its growth effectively; the Company's ability to identify and complete acquisitions or other strategic transactions that complement and expand the Company's business capabilities and successfully integrate newly acquired businesses into the Company's operations, retain key employees, and realize cost savings, synergies and other related anticipated benefits within the expected time period; the Company's ability to identify and complete divestitures and to achieve the anticipated benefits therefrom; the Company's ability to develop products incorporating new technologies, including augmented reality, artificial intelligence, and virtual reality, and realize benefits from such products; the Company's use of artificial intelligence, including generative artificial intelligence; adverse tax consequences for the Company, its operations and its stockholders, that may differ from the expectations of the Company, including that future changes in tax laws, potential increases to corporate tax rates in the United States and disagreements with tax authorities on the Company's determinations that may result in increased tax costs; adverse tax consequences in connection with the business combination that formed the Company in August 2021, including the incurrence of material Canadian federal income tax (including material "emigration tax"); the Company's ability to maintain an effective system of internal control over financial reporting, including the risk that the Company's internal controls will fail to detect misstatements in its financial statements; the Company's ability to accurately forecast its future financial performance and provide accurate guidance; the Company's ability to protect client data from security incidents or cyberattacks; economic disruptions resulting from war and other economic and geopolitical tensions (such as the ongoing military conflicts between Russia and Ukraine and in the Middle East), terrorist activities, natural disasters, public health events and tariff and trade policies; stock price volatility; and foreign currency fluctuations. Investors should carefully consider these risk factors, other risk factors described herein, and the additional risk factors outlined in more detail in our 2024 Form 10-K, filed with the Securities and Exchange Commission (the "SEC") on March 11, 2025, and accessible on the SEC's website at www.sec.gov, under the caption "Risk Factors," and in the Company's other SEC filings. SCHEDULE 1 STAGWELL INC. UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS (amounts in thousands, except per share amounts) Three Months Ended March 31, 2025 2024 Revenue $ 651,740 $ 670,059 Operating Expenses Cost of services 412,087 444,526 Office and general expenses 179,362 163,343 Depreciation and amortization 42,006 34,836 Impairment and other losses — 1,500 633,455 644,205 Operating Income 18,285 25,854 Other income (expenses): Interest expense, net (23,356) (20,965) Foreign exchange, net 1,220 (2,258) Other, net 249 (1,267) (21,887) (24,490) Income (loss) before income taxes and equity in earnings of non-consolidated affiliates (3,602) 1,364 Income tax expense 1,722 2,585 Loss before equity in earnings of non-consolidated affiliates (5,324) (1,221) Equity in income (loss) of non-consolidated affiliates (1) 508 Net loss (5,325) (713) Net (income) loss attributable to noncontrolling and redeemable noncontrolling interests 2,408 (569) Net loss attributable to Stagwell Inc. common shareholders $ (2,917) $ (1,282) Loss Per Common Share: Basic $ (0.03) $ (0.01) Diluted $ (0.04) $ (0.01) Weighted Average Number of Common Shares Outstanding: Basic 112,088 112,633 Diluted 263,737 116,405 SCHEDULE 3 STAGWELL INC. UNAUDITED SEGMENT OPERATING RESULTS (amounts in thousands) For the Three Months Ended March 31, 2025 Integrated Agencies Network Brand Performance Network Communications Network All Other Corporate Total Net Revenue $ 325,794 $ 146,858 $ 66,998 $ 24,537 $ — $ 564,187 Billable costs 51,560 15,360 20,630 3 — 87,553 Revenue 377,354 162,218 87,628 24,540 — 651,740 Billable costs 51,560 15,360 20,630 3 — 87,553 Staff costs 199,882 96,450 44,577 15,455 11,898 368,262 Administrative costs 31,644 23,407 10,174 8,225 1,659 75,109 Unbillable and other costs, net 17,099 15,458 490 7,187 — 40,234 Adjusted EBITDA (1) 77,169 11,543 11,757 (6,330) (13,557) 80,582 Stock-based compensation 4,145 1,368 693 229 5,108 11,543 Depreciation and amortization 21,364 7,722 5,175 4,301 3,444 42,006 Deferred acquisition consideration 5,863 (1,282) 1,213 863 — 6,657 Other items, net (1) (2,246) 3,654 128 311 244 2,091 Operating income (loss) $ 48,043 $ 81 $ 4,548 $ (12,034) $ (22,353) $ 18,285 (1) See Non-GAAP Financial Measures section above for the definition of Adjusted EBITDA and Other items, net. SCHEDULE 4 STAGWELL INC. UNAUDITED SEGMENT OPERATING RESULTS (amounts in thousands) For the Three Months Ended March 31, 2024 Integrated Agencies Network Brand Performance Network Communications Network All Other Corporate Total Net Revenue $ 292,772 $ 162,562 $ 67,488 $ 9,632 $ — $ 532,454 Billable costs 59,947 51,400 26,258 — — 137,605 Revenue 352,719 213,962 93,746 9,632 — 670,059 Billable costs 59,947 51,400 26,258 — — 137,605 Staff costs 186,534 98,431 39,264 7,821 10,107 342,157 Administrative costs 30,602 22,071 8,704 3,209 2,577 67,163 Unbillable and other costs, net 15,528 14,566 136 2,588 — 32,818 Adjusted EBITDA (1) 60,108 27,494 19,384 (3,986) (12,684) 90,316 Stock-based compensation 9,321 2,043 1,049 98 3,605 16,116 Depreciation and amortization 19,381 7,514 2,894 2,421 2,626 34,836 Deferred acquisition consideration 2,045 (777) (1,114) — — 154 Impairment and other losses 1,500 — — — — 1,500 Other items, net (1) 5,511 5,019 282 174 870 11,856 Operating income (loss) $ 22,350 $ 13,695 $ 16,273 $ (6,679) $ (19,785) $ 25,854 (1) See Non-GAAP Financial Measures section above for the definition of Adjusted EBITDA and Other items, net. SCHEDULE 5 STAGWELL INC. UNAUDITED RECONCILIATION OF ADJUSTED DILUTED EARNINGS PER SHARE (NON-GAAP MEASURE) (amounts in thousands, except per share amounts) For the Three Months Ended March 31, 2025 GAAP Adjustments Non-GAAP Net income (loss) attributable to Stagwell Inc. common shareholders $ (2,917) $ 18,439 $ 15,522 Net income (loss) attributable to Class C shareholders (6,637) 24,513 17,876 Net income (loss) attributable to Stagwell Inc. and Class C shareholders and adjusted net income $ (9,554) $ 42,952 $ 33,398 Weighted average number of common shares outstanding 112,088 9,462 121,550 Weighted average number of shares of Class C Common Stock outstanding 151,649 — 151,649 Weighted average number of shares outstanding 263,737 9,462 273,199 Diluted EPS and Adjusted Diluted EPS (1) $ (0.04) $ 0.12 Adjustments to Net Income (loss) Amortization $ 32,981 Stock-based compensation 11,543 Deferred acquisition consideration 6,657 Other items, net 2,091 53,272 Adjusted tax expense (10,320) $ 42,952 (1) Adjusted Diluted EPS is defined within the Non-GAAP Financial Measures section of the Executive Summary. SCHEDULE 6 STAGWELL INC. UNAUDITED RECONCILIATION OF ADJUSTED DILUTED EARNINGS PER SHARE (NON-GAAP MEASURE) (amounts in thousands, except per share amounts) For the Three Months Ended March 31, 2024 GAAP Adjustments Non-GAAP Net income (loss) attributable to Stagwell Inc. common shareholders $ (1,506) $ 19,480 $ 17,974 Net income attributable to Class C shareholders — 24,554 24,554 Net income (loss) attributable to Stagwell Inc. and Class C shareholders and adjusted net income $ (1,506) $ 44,034 $ 42,528 Weighted average number of common shares outstanding 116,405 4,534 120,939 Weighted average number of shares of Class C Common Stock outstanding — 151,649 151,649 Weighted average number of shares outstanding 116,405 156,183 272,588 Diluted EPS and Adjusted Diluted EPS (1) $ (0.01) $ 0.16 Adjustments to Net income (loss) Amortization $ 28,203 Impairment and other losses 1,500 Stock-based compensation 16,116 Deferred acquisition consideration 154 Other items, net 11,856 57,829 Adjusted tax expense (12,748) 45,081 Net loss attributable to Class C shareholders (1,047) $ 44,034 Allocation of adjustments to Net income Net income attributable to Stagwell Inc. common shareholders $ 19,480 Net income attributable to Class C shareholders - add-backs 25,601 Net loss attributable to Class C shareholders (1,047) 24,554 $ 44,034 (1) Adjusted Diluted EPS is defined within the Non-GAAP Financial Measures section of the Executive Summary. SCHEDULE 7 STAGWELL INC. UNAUDITED CONSOLIDATED BALANCE SHEETS (amounts in thousands) March 31, 2025 December 31, 2024 ASSETS Current Assets Cash and cash equivalents $ 137,653 $ 131,339 Accounts receivable, net 772,974 716,415 Expenditures billable to clients 163,702 173,194 Other current assets 147,163 114,200 Total Current Assets 1,221,492 1,135,148 Fixed assets, net 69,017 72,706 Right-of-use assets - operating leases 209,720 219,400 Goodwill 1,562,490 1,554,146 Other intangible assets, net 822,964 836,783 Other assets 96,671 90,038 Total Assets $ 3,982,354 $ 3,908,221 LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS ("RNCI"), AND SHAREHOLDERS' EQUITY Current Liabilities Accounts payable $ 420,779 $ 449,347 Accrued media 295,964 245,883 Accruals and other liabilities 219,047 265,356 Advance billings 311,329 294,609 Current portion of lease liabilities - operating leases 56,390 60,195 Current portion of deferred acquisition consideration 37,336 51,906 Total Current Liabilities 1,340,845 1,367,296 Long-term debt 1,465,323 1,353,624 Long-term portion of deferred acquisition consideration 55,941 50,209 Long-term lease liabilities - operating leases 224,323 245,397 Deferred tax liabilities, net 47,323 47,239 Other liabilities 57,850 59,139 Total Liabilities 3,191,605 3,122,904 Redeemable Noncontrolling Interests 10,856 8,412 Commitments, Contingencies and Guarantees Shareholders' Equity Common shares - Class A 114 115 Common shares - Class C 2 2 Paid-in capital 343,082 343,647 Retained earnings 10,504 11,740 Accumulated other comprehensive loss (19,302) (23,773) Stagwell Inc. Shareholders' Equity 334,400 331,731 Noncontrolling interests 445,493 445,174 Total Shareholders' Equity 779,893 776,905 Total Liabilities, Redeemable Noncontrolling Interests and Shareholders' Equity $ 3,982,354 $ 3,908,221 SCHEDULE 8 STAGWELL INC. UNAUDITED SUMMARY CASH FLOW DATA (amounts in thousands) Three Months Ended March 31, 2025 2024 Cash flows from operating activities: Net loss $ (5,325) $ (713) Adjustments to reconcile net income to cash used in operating activities: Stock-based compensation 11,543 16,116 Depreciation and amortization 42,006 34,836 Amortization of right-of-use lease assets and lease liability interest 17,118 20,912 Impairment and other (gains) losses (3,529) 1,500 Deferred income taxes (747) (655) Adjustment to deferred acquisition consideration 6,657 154 Other, net (2,060) 292 Changes in working capital: Accounts receivable (44,701) (42,976) Expenditures billable to clients 11,095 6,681 Other assets (32,778) (19,584) Accounts payable (35,287) 22,206 Accrued expenses and other liabilities (19,075) (63,856) Advance billings 15,628 (6,124) Current portion of lease liabilities - operating leases (20,558) (21,660) Deferred acquisition related payments — (250) Net cash used in operating activities (60,013) (53,121) Cash flows from investing activities: Capitalized software (11,966) (8,794) Capital expenditures (3,912) (5,439) Acquisitions, net of cash acquired (1,090) (11,673) Other (3,391) (218) Net cash used in investing activities (20,359) (26,124) Cash flows from financing activities: Repayment of borrowings under revolving credit facility (432,000) (417,000) Proceeds from borrowings under revolving credit facility 543,000 540,000 Shares repurchased and cancelled (11,068) (29,698) Distributions to noncontrolling interests (581) (559) Payment of deferred consideration (16,103) (1,657) Net cash provided by financing activities 83,248 91,086 Effect of exchange rate changes on cash and cash equivalents 3,438 (1,754) Net increase in cash and cash equivalents 6,314 10,087 Cash and cash equivalents at beginning of period 131,339 119,737 Cash and cash equivalents at end of period $ 137,653 $ 129,824 SOURCE Stagwell Inc. 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STAGWELL INC. (NASDAQ: STGW) REPORTS RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2025

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